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<br />rCI ----'\) <br />( ); <br />~li( <br /> <br />Item #5.S: <br /> <br /> <br />MEMORANDUM <br /> <br />River TO: <br /> <br />FROM: <br /> <br />Mayor & City co~ <br />Pat Klaers, City ~trator <br />July 12, 1999 <br /> <br />DATE: <br /> <br />SUBJECT: Gas Franchise Requests <br /> <br />The city has been approached by NSP representatives regarding the <br />possibility of obtaining a gas franchise agreement from the city. Two staff <br />meetings have been held with NSP representatives and all of the pluses and <br />minuses of having two gas franchises within the municipality have been <br />discussed and reviewed. <br /> <br />. <br /> <br />The biggest positive for this request is competition and free enterprise. <br />However, it should be noted that the benefit of this competition generally will <br />be for the developers in the community and not necessarily passed onto the <br />citizens/resident/business owner. Accordingly, this positive for having two <br />gas franchise's within the municipality may not exactly trickle down to our <br />citizens. <br /> <br />Two of the major concerns with having two gas franchises within the city <br />relate to public safety and having another utility within the city's right-of- <br />way. The public safety concern has generally been dismissed by Reliant <br />(Minnegasco), NSP, and the Fire Chief as both utilities will respond if there <br />is a gas line break and both utilities will work on each other's gas lines if <br />they are the first on the scene. The right-of-way concern is largely based on <br />the future being unknown in terms of what additional requests the city will <br />have for utilities, telephone systems, cable TV systems, etc., to be located in <br />its right-of-way. We certainly don't want a congested right-of-way system <br />that inhibits any type of utility maintenance or repair activities. The way <br />technology is improving and changing, it is very uncertain as to what, for <br />example, the telecommunication industry will be doing in the future and <br />where they will want to be located. The right-of-way concern is probably our <br />biggest issue with this request and the loudest voice of concern is coming <br />from me and Utilities General Manager Bryan Adams. <br /> <br />. <br /> <br />Another issue that must be dealt with regarding two gas franchises within <br />the city is deciding which company serves which development or area of the <br />city. This is a problem that can be dealt with, but it may involve additional <br />work at the staff level, and maybe at the City Council level. The City Council <br />could let the "market" decide which company serves which development, or if <br />the city could establish "territories" where one company has a certain part of <br />13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · TDD & Phone: (612) 441-7420 · Fax: (612) 441-7425 <br />